Retail sales in Chicago climb above pre-recession levels in 2013

May 08, 2014|By Corilyn Shropshire | Tribune staff reporter

Shoppers exit a Walmart on the 4600 block of West Diversey Avenue in April. (John J. Kim/ Chicago Tribune)

Retail sales in the Chicago area rose 4.8 percent in 2013 to $110.8 billion, topping pre-recession totals, according to a report released this week by Melaniphy & Associates Inc., a Chicago-based retail and real estate consultancy.

Not since 2007, when sales peaked at $106.9 billion, have sales receipts been so high, according to the report.

Chicago-area consumers stocked up on clothing, accessories, furniture and electronics. The largest category, food stores, rang up $13.4 billion in sales receipts last year, up nearly 2 percent from 2012.

The surge in spending was likely due to pent-up demand, according to John Melaniphy III, who wrote the report.

“During 2013 improvement in housing values as well an improvement in real income and consumer confidence was up, gas prices had declined and the overall economy and economic indicators were rising,” he said.

But while consumers showed a lot more interest in spending money in 2013, the general merchandise category, which includes area department and big box stores, experienced a drop in sales, slipping 1 percent to $12 billion, according to the report.

Melaniphy blamed the dip on Target's data breach late last year.

“The widespread decline in general merchandise category, throughout Cook was concerning particularly in an environment where most categories were increasing sales,” Melaniphy said.

“We felt that the (Target) data breach may have played a role in the decline in sales given the large number of Target stores throughout the metropolitan area,” he said. “There are other merchandise retailers that may have also experienced some weakness, including J.C. Penney and Sears, but the decline was so widespread that we considered the Target data breach to be one of the primary factors of the decline.”

The breach, in which 40 million credit card numbers and 70 million other pieces of consumer data were stolen nationwide in December, hurt profits and led to the resignation of President and CEO Gregg Steinhafel this week.

Cook County, which includes the Chicago market, recorded nearly $64 billion in retail sales in 2013, up 4.9 percent. That's across a broad swath of categories, including drinking and eating establishments and food stores. Also included in the study were apparel and accessories stores, furniture and electronics stores, drugstores and other miscellaneous stores, auto dealers and gasoline service stations, and home improvement stores.

Meanwhile, the city of Chicago saw a retail sales jump of 4.9 percent to $25.5 billion. Sales in DuPage County rose the highest, 6.1 percent, to $18.2 billion.

The remaining collar counties, including Kane, Lake, McHenry and Will rang up a total of $28 billion.

The sales figures in the Melaniphy report are calculated from recently released sales tax data from the Illinois Department of Revenue. Illinois is one of the few states that make retail sales tax data public, allowing analysts to compute a snapshot of consumer spending.

Of the 20 suburbs included in the study, only Skokie saw a decline in retail sales, dropping 6.6 percent, to $1.3 billion last year, which Melaniphy said was likely because of store closings.

Naperville topped the list of Chicago suburbs with the most sales receipts, ringing up $3.2 billion. It was trailed closely by Schaumburg, which recorded $3 billion in sales in 2013.